Final SLP: The Currency and Banking Situation in America

AMERICAN CURRENCY
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Instructor
10th November 2015
The strength of a currency is the value at which it will be exchanged for other currencies around the world. The exchange is either inland or in the international business sphere. The exchange rate of one unit of a currency compared to other currencies should be relatively constant through the days to be considered stable. Several factors contribute to the stability of any currency. An examination is given to the United States dollar currency and how its market trends change, whether stable or irregularly changing. Important to note will be the contribution of the banking industry towards ensuring the stability of the currency.
The American dollar is a stable currency. It is one of the strongest official units of trade around the world. Its strength and stability explains the reason why it is used as the number one currency in America and globally. The exchange rate of the dollar does not fluctuate by a great value. A major contribution to this is the strong American economy. This has attracted investors from several parts of the world besides being a secured country. With a stable economy, business security and a safe trading environment the rates have been stable for a long period of time.
Factors that can affect the rate of exchange of the currency are inclusive of balance of trade and investments, political nature of countries, economic theories among others. These coupled with the financial institutions will explain the trends that occur with the currency. Most of these factors have always worked to the advantage of America thereby stabilizing the dollar.
The American banking system is currently safe. After the economic crisis of 2008 it has gained a proper ground with housing and banking industry being stable (James Quinn, ND). The problems that faced it are now contained with people seen to develop trust with the financial institutions. According to Charles Morris (2011) several revisions were done to financial laws in order to protect the financial institutions from any laws that would render them unsafe. He points out that central bank will issue loans to strained banks to maintain their operations. This is a move that central banks around the world have done to help such banks that are faced with problems as this.
Despite the safety several factors around the globe have subjected the American dollar to tides and waves. Besides being stable it faces problems that threaten to weaken its value around. Some of these factors occur within the country...